In Brief
A US-incorporated company engaged in data services and an Indian software solutions firm entered into service agreements with payment disputes. When the respondent filed a criminal complaint alleging cheating and misappropriation under IPC Sections 420, 406, 409 and 120B, the High Court dismissed the appellant's petition to quash. The Supreme Court allowed the appeal, holding that the dispute was fundamentally contractual—concerning service quality and payment obligations—not a criminal matter. No evidence showed fraudulent intent at contract formation; the parties had made substantial payments and had competing claims. The Court quashed the criminal proceedings, finding the dispute was for civil resolution through the agreed arbitration mechanism."
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